5 ms·

AAPL

by vellum 15y ago

AAPL

benjaminwootton 15y ago
I worry about Apple. They've had a great run, but where can their next $billion market come from? To an extent, the current share price will be factoring in future growth on the same trajectory as we've observed over the last few years.
- forrestblount 15y ago
  The question with AAPL is really do you think smartphones and tablets, as product segments unto themselves, have reached market saturation? I think we'll still see massive increases in the sheer number of smartphones and tablets sold, and I think AAPL will manage to retain a significant (not necessarily a majority) market share.
  - polshaw 15y ago
    You also have to consider if you think apple could continue to keep their margins in an established tablet market, and a smartphone market approaching 'good enough' like that of PCs today, and whether consumers will continue to accept a 'walled garden' as tablets become primary computing devices. E: I'd like to clarify I'm including stuff like no USB ports in walled garden.
    - intended 15y ago
      This next statement is probably going to get me nuked, but: I think people have accepted the walled garden model and they like it. In a perverse way, their success is partly because of the PC era itself. The lowered expectations people have of computational devices from windows makes. Having something that "Just works" such a blessing, for such a ridiculous portion of all consumers, that their "walled garden" translates into "sanctuary" for most human beings. IF in the future mature market, other tablets have also reached a stage where "it just works", then its an even playing field. At that point,the walled garden will be just another field to walk between. Edited for clarity
  - cdavid 15y ago
    Many people feel the same way as you do, which means the information is very likely already in the current share price. Buying APPL stock today implies that you think apple will to better than current expectations, not current apple market share, etc...
- maigret 15y ago
  But due to their relatively low P/E, they don't even need to grow that much to still be worth. Their current P/E is not forecasting a huge growth in the next years. It's not the same for, say Amazon. They'll need to earn 5x more to get back in the "standard zone". So investors seem to think Amazon still has a huge growth forward.
ig1 15y ago
If you work in the tech industry it probably makes sense not to invest in it. If there's a tech crash that damages your employability then you don't want it to damage your investment portfolio as well.
- rdl 15y ago
  Definitely true for single companies (ie don't hold only your employer's stock...), or for short term. For a retirement fund, I still think tech gives the best 50 year returns, as a sector.
  - davidw 15y ago
    > I still think tech gives the best 50 year returns, as a sector. Why's that?
    - intended 15y ago
      Because growth. Take a mature industry - what are the sources of potential upside? Growth, more customers, perhaps from new geographies/product categories Efficiency improvements and thence profitability Occasionally new product innovation. Being a mature industry though, the chance of a break out innovation, that changes the face of the industry, is low. So your growth path for the industry tends to be tied to GDP growth in the end. With tech though, you can have a revolutionary product, which doesn't do it by redistributing power, but by increasing the share of the pie for everyone. And while doing this, tech still keeps the possibility of growth through diversification/geographical expansion AND efficiency improvements which will be discovered over time. Sorry I am a bit tired, so I may not have made the most educational of responses.
      - davidw 15y ago
        The airline industry grew tremendously over the last 50 years, but you wouldn't know it from many stocks in that industry...
        15y ago
acheron 15y ago
I mentioned index funds somewhere else in the thread; possibly worth noting that if you invest in, e.g., a normal S&P500 fund, then you're de facto investing quite a lot in AAPL since it's going to be weighted by market capitalization. If that's worrying, you can find "equal weighted" funds, that use the same funds as the index but weight everything equally -- essentially betting against AAPL and XOM in favor of slightly smaller companies. I offer no opinion as to whether that's a good idea or not.

AAPL

by vellum 15y ago

AAPL

I worry about Apple. They've had a great run, but where can their next $billion market come from? To an extent, the current share price will be factoring in future growth on the same trajectory as we've observed over the last few years.

forrestblount 15y ago
The question with AAPL is really do you think smartphones and tablets, as product segments unto themselves, have reached market saturation? I think we'll still see massive increases in the sheer number of smartphones and tablets sold, and I think AAPL will manage to retain a significant (not necessarily a majority) market share.
- polshaw 15y ago
  You also have to consider if you think apple could continue to keep their margins in an established tablet market, and a smartphone market approaching 'good enough' like that of PCs today, and whether consumers will continue to accept a 'walled garden' as tablets become primary computing devices. E: I'd like to clarify I'm including stuff like no USB ports in walled garden.
  - intended 15y ago
    This next statement is probably going to get me nuked, but: I think people have accepted the walled garden model and they like it. In a perverse way, their success is partly because of the PC era itself. The lowered expectations people have of computational devices from windows makes. Having something that "Just works" such a blessing, for such a ridiculous portion of all consumers, that their "walled garden" translates into "sanctuary" for most human beings. IF in the future mature market, other tablets have also reached a stage where "it just works", then its an even playing field. At that point,the walled garden will be just another field to walk between. Edited for clarity
- cdavid 15y ago
  Many people feel the same way as you do, which means the information is very likely already in the current share price. Buying APPL stock today implies that you think apple will to better than current expectations, not current apple market share, etc...
maigret 15y ago
But due to their relatively low P/E, they don't even need to grow that much to still be worth. Their current P/E is not forecasting a huge growth in the next years. It's not the same for, say Amazon. They'll need to earn 5x more to get back in the "standard zone". So investors seem to think Amazon still has a huge growth forward.

ig1 15y ago

If you work in the tech industry it probably makes sense not to invest in it. If there's a tech crash that damages your employability then you don't want it to damage your investment portfolio as well.

rdl 15y ago
Definitely true for single companies (ie don't hold only your employer's stock...), or for short term. For a retirement fund, I still think tech gives the best 50 year returns, as a sector.
- davidw 15y ago
  > I still think tech gives the best 50 year returns, as a sector. Why's that?
  - intended 15y ago
    Because growth. Take a mature industry - what are the sources of potential upside? Growth, more customers, perhaps from new geographies/product categories Efficiency improvements and thence profitability Occasionally new product innovation. Being a mature industry though, the chance of a break out innovation, that changes the face of the industry, is low. So your growth path for the industry tends to be tied to GDP growth in the end. With tech though, you can have a revolutionary product, which doesn't do it by redistributing power, but by increasing the share of the pie for everyone. And while doing this, tech still keeps the possibility of growth through diversification/geographical expansion AND efficiency improvements which will be discovered over time. Sorry I am a bit tired, so I may not have made the most educational of responses.
    - davidw 15y ago
      The airline industry grew tremendously over the last 50 years, but you wouldn't know it from many stocks in that industry...
      - 15y ago

acheron 15y ago

I mentioned index funds somewhere else in the thread; possibly worth noting that if you invest in, e.g., a normal S&P500 fund, then you're de facto investing quite a lot in AAPL since it's going to be weighted by market capitalization. If that's worrying, you can find "equal weighted" funds, that use the same funds as the index but weight everything equally -- essentially betting against AAPL and XOM in favor of slightly smaller companies. I offer no opinion as to whether that's a good idea or not.